Huawei is reportedly building a “mega-facility” for chip production in China, which will be responsible for the firm’s in-demand Kirin and Ascend chips.
Huawei’s New Chip Facility Will Be Responsible For 7nm & Above Production; Dedicated Towards Production of AI Chips
It won’t be wrong to say that Huawei has evolved tremendously over the past few years, initially being a mobile-focused firm, to now challenge NVIDIA in the AI segment. Especially in recent times, Huawei has shown massive progress with its Ascend AI chips, to the point that the firm had difficulty sustaining demand amid confined production lines. However, this looks to change as the Financial Times reports that Huawei is developing a massive chip facility in Shenzhen, as part of the efforts to integrate the “AI supply chain vertically”.
The new facilities being developed in the region will likely be responsible for catering to Huawei’s 7nm production, mainly for Kirin mobile chips and the Ascend AI processors. It is claimed that the site being developed is close to the facilities of other Chinese foundries like Pengxinwei (PXW) and Shenzhen Pensun (PST), which are said to be a part of Huawei’s supply chain. So it is likely that the Chinese tech giant is developing a “hub for foundries”, which will make sourcing much faster and allow Huawei and its partners to be closely linked together.
The project is being funded by the local government as well, and it is claimed that Huawei won’t directly operate the facilities; rather, firms like SiCarrier and SwaySure will take responsibility. Huawei will play a key role initially, providing the required funding and dispatching management and technical teams. This allows the firm to have an ecosystem of partners through which it can essentially oversee every part of the supply chain, and this is one of the driving reasons behind Huawei’s tremendous progress over the years.
Huawei’s step into the semiconductor channels comes after SMIC’s disappointing performance in terms of catering to the demand coming from the industry. It is claimed that the firm sees “millions” of orders for its Ascend AI chips, and China’s most prominent semiconductor firm cannot handle the demand right now, hence Huawei needs to upscale the production lines on an urgent basis. The facility being developed in Shenzhen could be operational as soon as next year, and it will likely be the first step towards Huawei achieving sustainability in advanced chip technology.
